Arwen receives $3.3M in funding to develop technology for secure settlement of digital assets.
Arwen, a blockchain-infrastructure company based in Boston, has secured $3.3M in venture funding to continue innovating on secure settlement for digital asset trading. The company, founded in 2017 by its CEO Sharon Goldberg (a tenured professor at Boston University and expert in cybersecurity) and CTO Ethan Heilman (a BU PhD and contributor to Bitcoin Core), will use the funding to expand its technology to institutional market participants and embed it in industry-leading digital asset platforms. The round was led by Slow Ventures with participation from Coinshares, Collaborative Fund, Underscore VC, and DG Lab Fund.
February 5, 2020
Today’s digital asset market relies on trade settlement processes that are cumbersome, inefficient and subject to substantial systemic risks. Settlement largely relies on centralized parties, often using approaches copied directly from traditional markets. Centralized parties are a focal point for attacks; almost $500M in digital assets were stolen from centralized platforms in the first half of 2019 alone. And when no centralized party is available, traders resort to bilateral arrangements that are susceptible to counterparty risk. The process used for settlement is also highly inefficient, requiring human operators to manually verify and reconcile each settlement transaction.
Sharon Goldberg, Arwen’s CEO, said:
To support its growth, the digital asset economy must differentiate itself from traditional capital markets. This requires technology that goes beyond the institution of yet-another centralized entity. Arwen’s technology delivers on the promise of blockchain — decentralization— while eliminating counterparty risk and streamlining operations during the precarious moments when digital assets move as part of trade settlement.
Arwen has developed blockchain-based technology that streamlines settlement and eliminates counterparty risk. While the market has seen a many innovative solutions for digital asset custody, Arwen allows institutions to secure their assets when they are most at risk: while in motion during settlement. The company’s technology also allows institutions to cut down the time spent on settlement, reduce human error, and simplify reconciliation. The goal is to create a standard for digital-asset settlement that operates across custody solutions, supporting a more interconnected, secure and trustworthy digital asset market.
Jill Carlson, who led the investment by Slow Ventures, commented:
Having worked on Wall Street and seen the inefficiencies present in the legacy financial system, the promise of peer-to-peer technology to fundamentally shift the way we trade and transact is clear. That said, today’s technologies fall short of this, requiring the existence of third parties to clear and settle trades. Arwen changes this by enabling simultaneous delivery-versus-payment for the first time. The implications of this are enormous, not just for cryptocurrency, but across asset classes and markets broadly.
Meltem Demirors, who led CoinShares’ investment, commented:
Digital assets like bitcoin represent an exciting opportunity to evolve market structure by enabling assets to settle programmatically and with finality without layers of trusted intermediaries. With more institutions exploring ways to evolve the form and function of assets through tokenization, Arwen is poised to transform the way these markets clear and settle.
Richard Dulude, who led the investment by Underscore VC, commented:
Everybody worries about custody for digital assets. It’s all you hear about, and there are a lot of good companies competing to provide secure custody. Arwen, meanwhile, is taking on the problem of security for assets in motion, with a protocol that protects assets at the moments they are most at risk.
To learn more about Arwen’s institutional products, contact Scott Sigel (email@example.com).